Negotiation Levers

Replies

1. A cynical view (what else from a cynic): 

   BATNA LEVERS ARE NOT STRATEGIC ΓÇô SIGNALS OLD-FASHIONED, PRICE HAGGLING, GAME PLAYING / POWER BASED NEGOTIATIONS – Professor Joe Sandor ΓÇô Michigan State University

   BATNA Definition – Best Alternative to a Negotiated Agreement. BATNA is the recommended alternative action should your proposed agreement with another party fail to materialize ΓÇô typically because the buyer won’t go any higher and the seller won’t go any lower in price. If the results of your current negotiation offer a value that is less than your BATNA, there is no point in proceeding with the negotiations ΓÇô they have failed – use your best available alternative instead. Before negotiating, opponents should determine their own BATNAs and be prepared to “walk away” from the negotiations if their BATNA isn’t achieved.

   Sandor definition ΓÇô BATNA is just another term for price haggling best used when costs are unknown or too sketchy or relationships are underdeveloped. (I’ll have to ask my manager nonsense).┬á I’m astonished that people still make money selling and teaching a concept so obvious.┬á Some call it Power Negotiating ΓÇô make yourself some flash cards:┬á

   • You don’t get what you deserve, you get what you negotiate (Karrass ‘Fortune without Luck’ ads in all airline magazines).
   • Since everything you want is controlled by someone else, you’re always negotiating.
   • Critical negotiating factors are power, information/preparation, technique and time.
   • The other party is always the opponent you must beat (because they’re trying to beat you).
   • You’ll be taught how to sit, interpret body language, be good cop/bad cop, when to flinch, how to cast red herrings and manage the physical negotiating environment.
   • Remember: Never accept the 1^st offer; Never reveal your budget and; Never share your deadline.
   • Exaggerate your minor concessions and demand large concessions in return.
   • Write the contract ΓÇô control the language, set the traps and exploit the ambiguities.
   • Suppliers exist to steal your profits.
   • Success is a function of how much value you can extract from your network ΓÇô typically suppliers and customers.

   An alternative to the above is strategic supply management.┬á Negotiations don’t occur in the traditional sense ΓÇô instead, collaborators share costs, develop alternatives, mutually solve problems and create knowledge.┬á If you feel compelled to use the word negotiation – (which I don’t recommend) – append the word negotiation with “fact-based”, “problem-solving”, “innovation generating” ΓÇô you get the picture.

   Ask questions like What’s important to you that might not be important to me?┬á How do we add costs to one another that can be reduced or eliminated?┬á How can we lower my TCO while increasing your margins? ┬áWhat do others do that seem better than what we are doing?┬á Again, you get the picture.┬á Power Negotiating is akin to writing a letter demanding a price reduction ΓÇô simple to do but, sorry folks, it isn’t strategic or sustainable and will not confer an absolute competitive advantage. ┬áInstead, follow the advice of Toyota’s Simon Nagata, “the only time you should negotiate is when you don’t know or understand your costs ΓǪΓǪΓǪΓǪ.ΓǪ and, you should never not know or understand your costs!”

   ——————————
   Joe Sandor
   Retired Professor
   Michigan State University
   Lecanto FL
   (517) 488-8931
   ——————————
   ——————————————-
   Original Message:
   Sent: 04-10-2018 23:21
   From: srinivas challagulla
   Subject: Negotiation Levers

   Does anybody have knowledge on Negotiation Levers.
   Could you please list all of them or give me a reference document.

   Thanks,

   ——————————
   srinivas challagulla
   Ascentix
   ——————————

   0

2. Excellent article !
   Dear Joe, can I use your words (using a quote from you, of course, formula)
   in my own article or lectures ?

   Thank you in advance !
   From a cynic to another one with cynicism … what else can we done ?

   ——————————
   Ovidiu Slimac
   President
   Romanian Union for Procurement Professionals
   Timișoara
   ——————————
   ——————————————-
   Original Message:
   Sent: 04-11-2018 17:18
   From: Joe Sandor
   Subject: Negotiation Levers

   A cynical view (what else from a cynic):

   BATNA LEVERS ARE NOT STRATEGIC ΓÇô SIGNALS OLD-FASHIONED, PRICE HAGGLING, GAME PLAYING / POWER BASED NEGOTIATIONS – Professor Joe Sandor ΓÇô Michigan State University

   BATNA Definition – Best Alternative to a Negotiated Agreement. BATNA is the recommended alternative action should your proposed agreement with another party fail to materialize ΓÇô typically because the buyer won’t go any higher and the seller won’t go any lower in price. If the results of your current negotiation offer a value that is less than your BATNA, there is no point in proceeding with the negotiations ΓÇô they have failed – use your best available alternative instead. Before negotiating, opponents should determine their own BATNAs and be prepared to “walk away” from the negotiations if their BATNA isn’t achieved.

   Sandor definition ΓÇô BATNA is just another term for price haggling best used when costs are unknown or too sketchy or relationships are underdeveloped. (I’ll have to ask my manager nonsense).┬á I’m astonished that people still make money selling and teaching a concept so obvious.┬á Some call it Power Negotiating ΓÇô make yourself some flash cards:┬á

   • You don’t get what you deserve, you get what you negotiate (Karrass ‘Fortune without Luck’ ads in all airline magazines).
   • Since everything you want is controlled by someone else, you’re always negotiating.
   • Critical negotiating factors are power, information/preparation, technique and time.
   • The other party is always the opponent you must beat (because they’re trying to beat you).
   • You’ll be taught how to sit, interpret body language, be good cop/bad cop, when to flinch, how to cast red herrings and manage the physical negotiating environment.
   • Remember: Never accept the 1^st offer; Never reveal your budget and; Never share your deadline.
   • Exaggerate your minor concessions and demand large concessions in return.
   • Write the contract ΓÇô control the language, set the traps and exploit the ambiguities.
   • Suppliers exist to steal your profits.
   • Success is a function of how much value you can extract from your network ΓÇô typically suppliers and customers.

   An alternative to the above is strategic supply management.┬á Negotiations don’t occur in the traditional sense ΓÇô instead, collaborators share costs, develop alternatives, mutually solve problems and create knowledge.┬á If you feel compelled to use the word negotiation – (which I don’t recommend) – append the word negotiation with “fact-based”, “problem-solving”, “innovation generating” ΓÇô you get the picture.

   Ask questions like What’s important to you that might not be important to me?┬á How do we add costs to one another that can be reduced or eliminated?┬á How can we lower my TCO while increasing your margins? ┬áWhat do others do that seem better than what we are doing?┬á Again, you get the picture.┬á Power Negotiating is akin to writing a letter demanding a price reduction ΓÇô simple to do but, sorry folks, it isn’t strategic or sustainable and will not confer an absolute competitive advantage. ┬áInstead, follow the advice of Toyota’s Simon Nagata, “the only time you should negotiate is when you don’t know or understand your costs ΓǪΓǪΓǪΓǪ.ΓǪ and, you should never not know or understand your costs!”

   ——————————
   Joe Sandor
   Retired Professor
   Michigan State University
   Lecanto FL
   (517) 488-8931
   ——————————

   Original Message:
   Sent: 04-10-2018 23:21
   From: srinivas challagulla
   Subject: Negotiation Levers

   Does anybody have knowledge on Negotiation Levers.
   Could you please list all of them or give me a reference document.

   Thanks,

   ——————————
   srinivas challagulla
   Ascentix
   ——————————

   0

3. Joe, while I agree that your approach promises to find better opportunities to achieve results favorable to both parties, traditional win-lose negotiators still exist. How do you personally know when you need to shift to more traditional negotiation approaches, including BATNA development and as the introductory discussion implied: the use of negotiation levers?

   Count me among those who believe you have to learn the range of negotiation approaches, including the use of super-collaborative negotiations where BATNAs essentially dissolve because interests are fully shared. But sadly, I’ve heard large contractors promote collaboration in one breath and turn to suppliers and demand price reductions with the other.┬á

   I suppose a related question is the effect of the competitive public procurement environment on this conversation. The federal government comes close to open book pricing with their requirement for submission of certified cost and pricing data in large acquisitions. But I can’t say that trust has been consistently part of the contracting relationships.

   Here is is an article from last year that retains the classic model of negotiation while inviting the kind of collaborative relationships that you describe. https://www.publicspendforum.net/blogs/richard-pennington/2017/06/20/negotiation-public-procurement

   ——————————
   Richard Pennington
   General Counsel
   NASPO ValuePoint
   Denver CO
   ——————————
   ——————————————-
   Original Message:
   Sent: 04-11-2018 17:18
   From: Joe Sandor
   Subject: Negotiation Levers

   A cynical view (what else from a cynic):

   BATNA LEVERS ARE NOT STRATEGIC ΓÇô SIGNALS OLD-FASHIONED, PRICE HAGGLING, GAME PLAYING / POWER BASED NEGOTIATIONS – Professor Joe Sandor ΓÇô Michigan State University

   BATNA Definition – Best Alternative to a Negotiated Agreement. BATNA is the recommended alternative action should your proposed agreement with another party fail to materialize ΓÇô typically because the buyer won’t go any higher and the seller won’t go any lower in price. If the results of your current negotiation offer a value that is less than your BATNA, there is no point in proceeding with the negotiations ΓÇô they have failed – use your best available alternative instead. Before negotiating, opponents should determine their own BATNAs and be prepared to “walk away” from the negotiations if their BATNA isn’t achieved.

   Sandor definition ΓÇô BATNA is just another term for price haggling best used when costs are unknown or too sketchy or relationships are underdeveloped. (I’ll have to ask my manager nonsense).┬á I’m astonished that people still make money selling and teaching a concept so obvious.┬á Some call it Power Negotiating ΓÇô make yourself some flash cards:┬á

   • You don’t get what you deserve, you get what you negotiate (Karrass ‘Fortune without Luck’ ads in all airline magazines).
   • Since everything you want is controlled by someone else, you’re always negotiating.
   • Critical negotiating factors are power, information/preparation, technique and time.
   • The other party is always the opponent you must beat (because they’re trying to beat you).
   • You’ll be taught how to sit, interpret body language, be good cop/bad cop, when to flinch, how to cast red herrings and manage the physical negotiating environment.
   • Remember: Never accept the 1^st offer; Never reveal your budget and; Never share your deadline.
   • Exaggerate your minor concessions and demand large concessions in return.
   • Write the contract ΓÇô control the language, set the traps and exploit the ambiguities.
   • Suppliers exist to steal your profits.
   • Success is a function of how much value you can extract from your network ΓÇô typically suppliers and customers.

   An alternative to the above is strategic supply management.┬á Negotiations don’t occur in the traditional sense ΓÇô instead, collaborators share costs, develop alternatives, mutually solve problems and create knowledge.┬á If you feel compelled to use the word negotiation – (which I don’t recommend) – append the word negotiation with “fact-based”, “problem-solving”, “innovation generating” ΓÇô you get the picture.

   Ask questions like What’s important to you that might not be important to me?┬á How do we add costs to one another that can be reduced or eliminated?┬á How can we lower my TCO while increasing your margins? ┬áWhat do others do that seem better than what we are doing?┬á Again, you get the picture.┬á Power Negotiating is akin to writing a letter demanding a price reduction ΓÇô simple to do but, sorry folks, it isn’t strategic or sustainable and will not confer an absolute competitive advantage. ┬áInstead, follow the advice of Toyota’s Simon Nagata, “the only time you should negotiate is when you don’t know or understand your costs ΓǪΓǪΓǪΓǪ.ΓǪ and, you should never not know or understand your costs!”

   ——————————
   Joe Sandor
   Retired Professor
   Michigan State University
   Lecanto FL
   (517) 488-8931
   ——————————

   Original Message:
   Sent: 04-10-2018 23:21
   From: srinivas challagulla
   Subject: Negotiation Levers

   Does anybody have knowledge on Negotiation Levers.
   Could you please list all of them or give me a reference document.

   Thanks,

   ——————————
   srinivas challagulla
   Ascentix
   ——————————

   0